Different approaches to leadership and management

In this attack the subsidiaries or employees have really infinitesimal chance to do a determination by themselves most of the clip the leader used to order his employees and command them by himself. This attack is the utmost type of transactional leading. In which the wages of the work is straight defined by the leader.

This attack is largely used in unskilled labor work where there is no or lessor demand of accomplishment or expertness are required. This attack frequently consequences in high turnover and high degree of absenteeism.

In my point of position Marcionne has used this sort of leading. But because of his foresight thought and proactive determination doing draw out the decree from the worst crisis of its history when it was about to fall in but Marcionne courageously and intelligently stabilise the status of the decree.

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Democratic leading attack

This is the moderate attack towards the determination doing procedure of the company. In this attack employees are frequently called for engagement. Although the concluding determination is made by the leader but the employees feels more assurance in determination devising because they think that their destiny wages direction and other affairs are settle by themselves.

This approaches although takes more clip but the consequences are frequently fruitful. This type of leader ship is frequently used where there is more importance of squad work instead than merely speed in productiveness. In instance of Oticon Kolind established this sort of environment in its administration and there was no segregation on the behalf of senior status or hierarchical rank but merely if they want do a work they have to merely inquire from their squad leader.

Individualistic Leadership attack

Actually this is a Gallic phrase which means “ go forth it be ” and in this attack directors or leaders frequently leave their employees to work by themselves.it can be proved effectual if there is proper and effectual feedback system prevails. This sort of attack frequently prevails where the workers are extremely skilled and self-motivated.

In Google Corporation this type of the attack is being followed.


Background and market place

Oticon was the first hearing assistance fabrication Danish company came into being in 1904. Oticon was figure one in market portions of 15 % in world-wide hearing AIDSs merchandises in the terminal of the 70 ‘ because their engineering promotion in miniaturisation enabled them for the mass production of hearing AIDSs. This place was challenged by the innovation of the ITE ( in the ear hearing poses device ) that was a better technological replacement than the BTE which dominated by Oticon. The market portion of Oticon dropped from 15 % to 7 % by 1987 since the debut of the ITE. Missing the economic systems of graduated table from BTE,

Oticon became the figure three hearing AIDSs behind Siemens Audiologische Technik ( Erlangen, Germany ) and Starkey ( Minneapolis, USA ) . With these conditions, we can turn to the competitory demands of Oticon in the audiometry industry. Bing figure three is really hard to prolong any profitable concern because it can non vie with the market leaders in fiscal resources, selling, trade name equity, every bit good as engineering creative activity with the companies like Siemens and Starkey. To last they need to better from their current strengths of high quality and high cost maker to agile company with extremely selected client focal point since quality hearing AIDSs is the criterion of regular merchandises.

Stairss to better fiscal and market place.

The strategic program for accomplishing competitory advantage in this industry can be addressed utilizing

Technology promotion

Economies of graduated table


Organization invention.

The breakthrough innovation of ITE that eroded the market portion of BTE is the best manner for any company to derive the competitory advantage. The know- how on how the mass produce the needful hearing AIDSs can recognize the economic systems of graduated tables for the new innovation like ITE. Targeting specific market section for the best Return on invested capital every bit good as doing a company more agile is besides valid method to accomplish competitory advantage in audiometry industry.

After Lars Kolind assumed the place of Oticon ‘s CEO, he cut 10-15 % of corporate employees and loss-money concerns. He besides realized that the company can non vie with two bigger rivals in engineering, selling and gross revenues because of the fiscal resources. With these restraints, he could merely seek to concentrate on clients and organisation invention. Oticon was aiming the costly section of the market every bit good as stressing to about 5000 cardinal hearing assistance dispensers and hearing clinics. In the organisational alteration to do Oticon more agile, he thought if he wanted to vie with large company like Siemens, he could non merely do 10 % alteration and expected to crush Siemens. This alteration has to be extremist, the extremist new organisation will non hold formal hierarchal describing relationships but with a resource allotment system construct around self-organized undertaking squads

Revolution in Oticon

With the globalisation of the hearing assistance productions and the monetary value force per unit area from the competition, the best production in the industry is non good plenty as the foundation to prolong the concern for Oticon. For Oticon to last and to win in this industry, it will necessitate to cut down entire cost of carry oning the concern by 30 % . With this figure set as the ultimate end, a undertaking for Oticon was formed as undertaking 330 to accomplish 30 % concern disbursal decrease in 3 twelvemonth. To carry through this end, the current organisation construction needed to be overhauled. Sustainable competitory advantage can merely be achieved with an organisation that is originative, advanced every bit good as flexible. Two touchable actable stairss: “ Dialogue ” and “ Action ” can be used to back up this conceptual route map to build this new organisation. This organisation should be alone and fast moving every bit good as extremely efficient. The basic features of this new organisation are

self-defined function ( employee can originate, take part and piece a undertaking to finish for proper support )

multi-level function ( every employee should take part at least 3 undertakings, in different Fieldss )

transparence ( cognition is shared organisation wise ) . This new organisation would be a team-based ( project-based ) organisation without formal construction.

Three cardinal inhibitors needed to be removed for this new organisation:

( 1 ) paper, the papers that circulates around offices and

( 2 ) wall, the divider among offices.

The “ duologue ” and “ action ” is a more efficient manner for communicating. With the purpose to disband the old, formal hierarchal construction of Oticon A/S, the procedure to set up an new organisation is genuinely a revolution in concern reengineering.

After the cost film editing and tweaking the company, Lars Kolind started to turn the company about by bring forthing net income of DKK 22 million in 1989. He knew this concern theoretical account was non sustainable. He needed to utilize a extremist attack for reorganisation to happen a sustainable concern theoretical account. On January 1, 1990, Kolind wrote a 4-page memo ( asked all Oticon employees to “ believe the unthinkable ” ) for alteration, it was the revolution needed for the organisation alteration in Oticon. three critical issues of making an nimble squad of 150 employees in head one-fourth could be identified from this instance survey

( 1 ) The dissension among “ old ” and “ immature ” employees on this altering procedure, “ old ” – directors and older employees and “ immature ” – newer employees that felt the demand for the alteration.

( 2 ) Culture barrier in Oticon ‘s functional sections that located in different metropoliss, R/D versus Corporate disposal. To make this cross-functional team- based organisation, he need to breakdown the barrier among internal functional divisions. He felt it would be a catastrophe to unify these two distinct sections with different civilizations. He proposed to hold every section to 3rd topographic point to get down a trade name new corporate civilization.

3 ) Kolind introduced new unfastened plane office construction that removes the wall between upper degree and lower degree direction and introduce latest computing machine and IT system which enables the employees to straight entree any director at any clip.

To garnering sufficient impulse for acceptance of these new thoughts, Kolind devoted himself to fixing employees to travel to this new caput one-fourth. He hired Sten Davidsen to pull off the alteration procedure. Davidsen prepared a one-page “ map ” of the alteration procedure to informed the advancement and stairss for employees to follow. Three groups were involved in this changing procedure

( 1 ) one group worked straight with the designers and applied scientists as they designed the new edifices for the new caput one-fourth

( 2 ) one group edited and published “ jutting 330, ” the newssheet to maintain every employee posted on the advancement

( 3 ) one group was formed with 13 people to develop other employee to utilize the new IT system. Monthly meetings were aid to maintain every employee with the construct of new organisation every bit good as the new concern theoretical account.

Kolind ‘s leading in Oticon

Without the production of new advanced ITE, Oticon slipped to figure three market portion in the planetary market. Although the tweaking of the concern by cutting 10- 15 % corporation employees and some money-loss concern to turn the company about with net income. This cut and cut concern theoretical account is non sustainable. Bing figure three, the Oticon lacked the fiscal resources to vie with Siemens in every concern facets from R/D passing for new engineering, selling, stigmatization, even distribution channels or aiming specific client section. The lone manner to finish with Siemens and Starkey were to make an nimble organisation that can non be replicated. The idea of non-replicated organisation was the chief ground for the “ think the unthinkable ”

Manifesto written by him on January 1, 1990. the lone manner to vie and last is to make a entire different organisation that is nimble and competent. As a CEO, Kolind had done plenty to fix his military personnels to process to the field for the flight. It is ever the internal inactiveness of the “ old ” that prevents this promotion. The perceptual experience of the company was performed OK created a false feeling the alteration was non needed, to see a CEO full charged for this extremist alteration was viewed as trouble-some by a batch of “ old ” employees.


Fiat is an acronym for Fabbrica Italiana Automobile Torino, ( Italian Automobile Factory Turin ) . It was founded in 1899 by a group of blue bloods and business communities, including Giovanni Agnelli, in the northern Italian metropolis of Turin in Piedmont.

The first auto produced was called “ 3V2 HP ” One hundred 50 workers in a little local mill produced 24 of them in 1900. In 1902, Giovanni Agnelli became the pull offing manager. Fiat ‘s first modern mill, Lingotto, was inaugurated in 1923, and a more modern one, Mirafiori in 1939. Both were named for the vicinities in Turin where they were located. Fiat autos foremost appeared in America in 1908 when a mill in Poughkeepsie, NY was licensed to do them. It functioned until 1917.

Presently, Fiat has five mills in Italy ; two in Brazil ; one in Poland and one in Argentina wholly using about 53,000 workers, about half of whom are in Italy. Fiat has been controlled by the Agnelli household from the beginning. After Giovanni died in 1945, Vittorio Valletta ran the company on their behalf until 1966 when Giovanni ‘s grandson, Gianni Agnelli took over. By the clip of his decease in 2003, Fiat had grown into a multi-national corporation.

Apart from cars, Fiat besides makes trucks, coachs, agricultural vehicles. It invests to a great extent in research and development and controls such celebrated luxury auto shapers as Alfa Romeo, Lancia, Maserati and Ferrari. The company operates in 50 states, and owns Ia Stampa, Turin ‘s day-to-day newspaper.

Presently Luca Cordero di Montezemolo is the president but John Elkann, an Agnelli inheritor, is vice-president, keeping the Agnelli presence in flesh and blood. In 2008, the Fiat Group had gross grosss of about $ 88 billion.

GM And Fiat Strategic And Industrial Alliance

Quick facts of the instance:

– In 2000 Fiat and GM enter into a ‘strategic and industrial confederation ( Fiat acquires a 5.1 % interest in GM and GM acquires a 20 % interest in Fiat ) .

– The understanding included a ‘put option ‘ , which stipulated that Fiat would hold the right to sell the staying 80 % to GM after 4 old ages at a just market value.

– Decree entered into the confederation to salvage its worsening car division ( losingss since early 90 ‘s )

– GM entered to maintain gait with consolidation tendency and to assist its European and Latin American divisions.

– Synergies like cost nest eggs, cross sharing of automotive engineerings were focused upon.

– By 2004, Fiat planned to exert the ‘put option ‘ , but GM rendered it nothingness because Fiat had sold its funding arm and had recapitalized.

End of the confederation

– Mid-2004 GM agreed to assist Fiat out of its fiscal turbulency. However, by terminal 2004 there were guesss that GM was seeking to sell its interest in Fiat and deny the duty of the put option.

– GM argued that the put option was null because Fiat had sold its funding arm Fidis. Fiat countered by stating GM could buyout 51 % of Fidis and that Fiat ‘s strategic freedom was restricted because the confederation between GM and Fiat stipulated that Fiat could non come in into confederations with others ( relationship-specific investing ) .

– Decree agreed to call off the put option if GM paid $ 3 billion, but GM merely agreed to pay up to the book value of its interest, which was $ 500 million finally GM pays $ 2 billion toget rid of this put option.

Recovery of decree

Back in Turin, the break-up of the Fiat-GM confederation was presented as a victory. Fiat placed advertizements proclaiming “ Fiat is all-Italian once more ” . It was about to establish the Grande Punto – a sharply-styled, larger version of the mainstream Fiat theoretical account – and purchasers in its place state got the message: Fiat ‘s market portion took an upturn.

At the same clip his newly-appointed technology head Harald Wester was look intoing whether sophisticated computing machine simulations could extinguish the demand to construct and prove expensive paradigms and therefore cut down development clip. The consequence was the new Bravo, which went on sale in Britain last hebdomad. It progressed from design to production in a record 18 months, about half the usual clip.

Table of Contentss

Different attacks to leading 1

Oticon 2

Fiat 6


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